Generational Preferences Drive Healthcare’s Next Move

Generational Preferences In Healthcare

While providers, payers and health tech innovators continue to reorient their businesses to focus on consumer preferences, it’s not always easy to predict which tactics will lead to growth.

There is a massive opportunity for healthcare organizations to get in touch with the true needs of consumers and proactively meet them — either directly or indirectly by enabling the delivery of more satisfying care interactions. What’s challenging is that consumer preferences vary by age as well as in the comfort level each group has with technology.

Generational distinctions pave the way for reimagined business models that respond to healthcare’s growing expectations for personalized experiences.

Healthcare for baby boomers and the silent generation

Older generations (baby boomers born 1946 to 1964 and the silent generation born 1928 to 1945) currently represent the largest consumers of healthcare. Now that many of these older Americans have had positive experiences with telehealth — even more so than their younger counterparts, according to CMS — they are ready to embrace tech-enabled services that meet them where they are, allowing them to improve health status and age in place.

It’s a mistake to assume that seniors are resistant to technology and won’t take advantage of remote patient monitoring, for example, as part of a health-at-home program. Seniors are steadily catching up with younger generations in terms of their access to the internet, and about 70 percent of those age 65 and older use a smartphone.

Their motivation for using technology for health is clear. Three-fourths of those age 50 and older prefer to stay in their homes or communities as they age, rather than moving to assisted living or other care-oriented residences. As a result, seniors are opting for home-based healthcare services and the technologies that come with it.

Estimates put the expected growth of health-at-home services in the United States above 7 percent CAGR, reaching $153 billion by 2029. What’s driving this growth is not just the size of the senior population but also their prevalence of chronic conditions that can be managed with at-home intervention.

Likewise, favorable regulatory changes are advancing the opportunity providers have to receive reimbursement for health-at-home services.  And of course, under Medicare Advantage agreements, plans have more flexibility to align the payment model with desired outcomes. The adage is still absolutely true that what gets paid gets delivered.

Healthcare for Gen X

Those in Gen X (born 1965 to 1980) — who are the senior leaders in the workforce today as well as the healthcare decision-makers for their children and parents — want more value from their health dollar and need more convenient access to care. They are juggling full-time work and caretaking while carrying more debt than any other generation.

They’re more inclined to use technology for practical purposes than for entertainment as their younger counterparts might. Like all aging consumers, Gen X populations are finding they need an increasing amount of health services as they age. They will no doubt demand more tech-enabled care in the future as their needs change.

Healthcare for millennials and Gen Z

We’ve entered an era where millennials (those born 1981 to 1996), Gen Z (born 1997 to 2012), and the generations coming after them, account for more than 50 percent of the U.S. population. They number 166 million compared to the 162 million represented by the combined Gen X, baby boomer, and older cohorts. And this large group of under-40 Americans expects healthcare services to be delivered with the same convenient, transparent, consumer-friendly digital capabilities they’ve become accustomed to in other aspects of their lives, such as banking or online shopping.

Their upbringing as digital natives means a predictably greater demand for seamless experiences with less loyalty to the status quo. Millennials and Gen Z populations are more dissatisfied with today’s convoluted care system, more willing to shop around for services, and more likely to use digital technologies.

While older individuals are less likely to adapt to shifts in their familiar healthcare offerings and remain the most loyal to their providers, Gen Z is highly adaptive and the least likely to have a primary care commitment. Gen Z is also more likely than other generations to seek financial assistance and low-cost alternatives for care. They also value price transparency, which makes them a prime target for the emerging retail healthcare market.

Retail takes on healthcare

The growing interest in ultra-convenient consumer-friendly care presents an opportunity for greater market disruption across all generations.

Retailers like Walmart, CVS, and others who are delivering direct-to-consumer healthcare with transparent pricing are a significant threat to traditional players because the retailers have an especially tight foothold in consumer engagement. They have a presence in the consumer’s existing workflow and fit in as a routine part of daily activities.

Health systems believe that among retailers, CVS (64 percent), Walmart (58 percent), and Amazon (57 percent) are “strong” or “extreme” threats to their business, according to one survey. Systems also report they have gained ground in digital offerings compared to non-healthcare companies since the pandemic, but 28 percent rank themselves as “far behind.”

To capitalize on what consumers want, stakeholders must assess their specific market opportunities and fill gaps in their capabilities. Each business will have unique factors that dictate its best path forward. Even technology innovators that play in the B2B market must create their solutions with their customers’ consumer-oriented growth strategy in mind.

Consumers influence the healthcare market

While the consumer has long been insulated from any real market influence in healthcare, the tables are turning. The democratization of data and the proliferation of patient-facing technology have set the stage for consumers to start making more choices for where they want to spend their healthcare dollars.

Savvy consumers of all ages are also beginning to factor in opportunity costs. For example, they will consider whether it’s best to wait for a traditional health service and use their insurance coverage, or instead choose greater convenience, even if they have to pay a bit more.  Many retailers have reported this phenomenon — consumers eschewing use of health insurance because it’s more convenient to pay cash. As new entrants begin to better understand how to build more efficient use of health insurance into the workflow, consumers will have more choices around payment.

Such choice increases consumer influence on the market. Healthcare businesses must be able to get out in front of these emerging opportunities rather than react to them later and attempt to catch up.

The Canton team has the data insight you need to identify shifting market dynamics in the context of demographic trends. We’ll help you create and deploy an insightful strategy to accelerate growth for your unique healthcare business. Reach out now to start a conversation!

There’s one missing piece that would advance health-at-home models in a hurry. See what it is.